Q&A: Utility Computing To Reshape IT Industry, Pundit Says

Carr has appeared as a business commentor on CNN and CNBC and has been published in The Economist, Fortune, Forbes and CIO Magazine. He discussed the shift toward the utility computing model and its implications for solution providers in an interview with John Roberts, CRN editorial research director.

CRN: How far along is the IT industry in progressing toward true utility computing?

CARR: I've actually been surprised at how much progress has been made over the last year, particularly in the increasing acceptance of the idea of utility computing. There's still a lot of debate about how broadly it will actually be adopted, but there has been a lot of progress in software, in the recognition of software service as a viable alternative in some areas. There has also been progress on the hardware side from suppliers that are introducing new types of utility services.

So even though I think the adoption of utility computing by businesses will go fairly slowly--because so much has been invested in the old "own it ourselves" model--my own sense is that adoption might go faster than I would have thought a year ago when I wrote the article.

CRN: So businesses’ attitudes toward utility computing are becoming more favorable?

CARR: That's true, at least over the past year. I think more users are seeing the utility model as a buyable alternative--at least in the future, if not right now.

CRN: Is this the case throughout the business market, or is it concentrated more among small and midsize companies?

CARR: As far as changing attitudes go, I think it's across all companies. But as far as actual adoption of utility computing, it's definitely greater among small and medium-size businesses. I mentioned in my article that this would probably be the case, simply because the old model of "own it yourself" IT requires considerable amounts of capital to invest in hardware and software. Utility computing offers these smaller companies a way to get some of the capabilities they need without having to invest a lot of capital.

CRN: Why are larger companies so slow to adopt utility computing? It seems they could take greater advantage of the economies of scale that utility computing offers than smaller firms could.

CARR: Because the bigger companies have already invested so much, it really will take a major event to get them to change over [to utility computing], like upgrading their data centers. They are not going to begin to switch over until there is a real need to re-evaluate their future investment.